Exhibit 10.6
A. T. Cross Company
Worldwide Executive Incentive Plan - 2000
Introduction
The following Annual Executive Compensation Incentive Plan (the
"Plan") will be implemented for 2000. The purpose of the Plan is
to motivate, retain and reward managerial and executive employees
for the achievement of certain business objectives. For 2000,
the Plan will be based on a combination of achievement of
Corporate Operating Income Before Taxes (OIBT), Territory OIBT,
Territory Net Sales Revenue, Return on Assets and Individual
Performance Objective Targets. Individual participants in the
Plan will be assigned different performance measurements,
considering their specific responsibilities. The combination of
the performance objectives and performance targets for each
participant will be determined based on individual positions and
agreed upon by the President and CEO along with the appropriate
Vice President or Managing Director.
How the Plan Works
Participants of Groups II - V are eligible to receive a
percentage of their base salary earnings as additional
compensation, based on the Company's and/or individual
achievement of specified performance targets, consistent with the
Company's business plan.
Performance Measures
A Plan bonus pool will be established when any of the performance
objective segments are achieved.
The Corporate OIBT segment of the bonus will be established at
threshold level when 85% of the Operating Income Before Tax
target is achieved and maximizes at 120%.
The Territory OIBT segment of the bonus pool will be established
when any of the participants achieve 85% of his or her objectives
and maximizes at 120%.
The net sales revenues segment is established when any of the
participants achieve 85% of the target and maximizes at 120%.
The return on assets segment is established when any of the
participants achieve 85% of the target and maximizes at 120%.
All participants in this segment will be assigned three
performance objectives, which will be approved by the Manager,
Vice President/Managing Director and the President & CEO. The
individual performance objective segment is established when any
of the participants achieve one of his or her objectives and
maximizes at 25% of the overall plan target percentage. Each
performance objective will be weighted 1/3. To qualify for any
payout in this segment, the objective must be fully and
completely accomplished. The payout is all or nothing on each
objective.
Eligibility
The Compensation Committee of A. T. Cross Company may appoint -
based on job content and performance - any salaried employee to
be a Group II, III, IV or V participant in the compensation
program. Individuals are placed in Groups II - V based on
similar levels of responsibility and ability to directly impact
the financial results of the Company. Participating employees
remain members until the end of the fiscal year in which they
were appointed. Eligible employees must be re-appointed to
participate each year.
Employees may participate for part of a year but must be actively
employed by the Company (except in cases of death or disability)
as of December 31 to be eligible for incentive awards relating to
that year.
Employees at International locations may also participate in this
plan. The applicable Managing Director will determine
international assignments to this plan with approval from the
President & CEO.
Applying all performance goals, the total range of award
opportunities as a percentage of base salary by participant group
is as follows:
Total Funding Levels as a Percentage of Base Earnings
Group Minimum Threshold Target Maximum
(85%) (100%) (120%)
(Achievement of relevant COIBT, TOIBT,
Net Sales or ROA)
II 0 20% 40% 60%
III 0 15% 30% 45%
IV 0 13% 25% 37%
V 0 10% 15% 25%
Payout of Plan Awards
Annual Incentive Awards will be distributed as soon as is
practicable after the close of the fiscal year. The Compensation
Committee will approve bonus awards. Awards will be made as a
percent of base salary paid for that year. Base salary does not
include any bonus payable under this Plan or any other incentive
plan, any life insurance premiums, special compensation, pension
benefits, profit sharing trust or Crossaver savings plan matching
allocations.
Performance results that fall between threshold, target and
maximum levels will yield the comparable interpolated funding
levels.
Allocations cannot exceed the total generated pool for Groups II
- - V.
Changes in Employment Status
Employees who are participants in the Plan for only part of a
fiscal year may participate in the Plan for the period or periods
of membership on a pro rata basis. However, participants must be
actively employed by the Company as of December 31 to be eligible
for incentive awards relating to that year.
Disability or Death
For participants who become disabled (i.e., eligible for Company
LTD benefits) or die while a member of the Plan, awards will be
determined in a pro-rated manner to reflect the period of time
the participant was an active member of the Plan. Payout will be
made-at the time the normal payout would have been made-to the
participant or participant's beneficiary(ies) if on file;
otherwise, payment will be made to the participant's estate.
Administration
The Compensation Committee of the Board of Directors of A. T.
Cross Company, whose decisions in all matters will be final, will
administer the Plan. The Committee reserves the right, subject
to the full Board's approval, to modify, amend, or discontinue
this Plan at any time. Any changes or amendments to the Plan
will not affect a participant's rights prior to the modification
unless the participant provides written consent.
Participation in this Plan does not confer any right to continued
employment by A. T. Cross. Similarly, selection for
participation in any one year does not necessarily guarantee
participation in future years. No member of the Compensation
Committee shall have any personal liability in connection with
the administration of the Plan.